Choosing my second dividend stock: VZ.
I don't use Verizon's wireless network, but with a dividend yield of 6.6 percent, I'm all in on its stock.
When I was in high school, I can remember being jealous of other members of my cross country team who had Verizon phones. We would travel to cross country camp in Northern Michigan, and I would have trouble getting a signal, while they would have no issues with cell coverage.
I can still hear the ad campaign in my head. “Can you hear me now,” the Verizon spokesman said over and over. I thought kids with phones on Verizon were pretty cool.
But I’ve never switched to Verizon as an adult. I still use T-Mobile to this day. I’m happy with T-Mobile’s 5G coverage and I have a really great deal on my monthly bill.
Still, as I look to invest in dividend stocks, Verizon’s 6.7 percent dividend yield is bringing back old feelings from high school and causing me to feel like a fan again.
Here’s what I found out about Verizon/VZ using the dividend stock evaluating framework from The Single Best Investment by Lowell Miller.
High Quality. While Verizon doesn’t currently have the assets to cover all of its debt, but it’s doing a good job of paying its debt down. The company’s revenue is largely steady, though its profits in 2021 were below its profits in 2022. And the company’s stock price is considered to be trading below its potential value.
High Current Dividend Yield. The company has a dividend yield of 6.7 percent. The industry average for March 2023 is 1.7 percent. And the company has a high dividend payout ratio of 51%. That’s incredible!
High Growth Dividend. Unfortunately, the stock analysis website I’m using, simplywall.st, doesn’t expect Verizon’s Dividend to grow much in the next few years.
Still, Verizon has paid dividends consistently for more than 20 years. I don’t know how much more the telecommunications companies like Verizon will grow, but I certainly don’t think they’re going to go anywhere anytime soon.
I’m confident picking Verizon as my second dividend stock investment.
In this newsletter, Evan Invests, I explore the world of investing from the perspective of the everyday investor by making small investments every month. Follow along with me as I look to grow my wealth through wise money management and making investments in cryptocurrency, index funds, stocks and more.
Let’s take a quick look at how my portfolio has been performing in the past week.
YTD invested (total): $1,955.87
YTD Growth: 9.9%
My Portfolio Holdings as of 4/14/23
Apple stock
HF Sinclair stock
Rocket Companies stock
Bitcoin
Fidelity 500 Index Fund
Invesco International Small-Mid Company Fund Class R6
Vanguard High Dividend Yield ETF
Vanguard International Dividend Appreciation Index Fund Admiral Shares
Vanguard Mid-Cap Growth Index Fund Admiral Shares
SPDR Portfolio S&P 500 Growth EFT
iShares S&P SmallCap 600 ETF
Vanguard FTSE Emerging Markets Fund
Invesco S&P 500 Momentum ETF
Vanguard FTSE Developed Markets ETF
Invesco S&P 500 Quality ETF
iShares Core S&P 500 ETF
Vanguard Total Bond Market ETF
I’ll report back next week.
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